The paper explains why an issuer may wish to raise external capital by selling multiple financial claims that partition its total asset cash flows, rather than a single claim. It is shown that in an asymmetric information environment, the issuer's expected revenue is enhanced by such cash flow...

The industrial structure of an intermediation industry is analysed in brokerage markets, where intermediaries help to reduce search frictions. The aspect of competition in intermediated markets is analysed in an `island economy', in which intermediaries invest in information networks, which...

I contrast equilibria in loan markets under bilateral bank- borrower relationships, in which proprietary technological knowledge of borrowers is not revealed to product-market competitors, with equilibria under multilateral financing which may lead to such knowledge being shared across...

In this article we study different time-series processes that may describe EMS exchange rate patterns. We conclude that conditional heteroskedasticity and discontinuous time paths are prominent features of EMS exchange rates. A combined jump- diffusion-ARCH model can capture these features...

This paper investigates the financial recontracting of firms in workouts and Chapter 11 reorganizations. The terms of recontracting include the medium of exchange used to redeem defaulted securities, the writedown of creditors claims, and deviations from absolute priority experienced by...

We develop a model of banking competition for deposits based on modern financial intermediation theory and industrial organization analysis. The standard demand deposit contract makes banks vulnerable to failure and introduces (endogenous) expectations-based vertical differentiation. A...

We construct a dynamic competitive model with futures markets where price volatility comes from information arrival and noise trading. In this model, we address three issues: What does informational efficiency mean in a multi-period setting? How do information arrival and noise trading interact...

This paper studies the design and valuation of debt contracts in a general dynamic setting under uncertainty. By incorporating some insights of the recent corporate finance literature into a valuation framework, we obtain a model which seems promising for the empirical study of pricing of risky...

This paper analyses bidding behaviour in the Mexican Treasury debt auction for the period 1986-9. Auction rules closely resemble those of the US Treasury auction: bidders submit multiple bids for multiple units. The majority of purchased quantities are immediately resold. Results suggest...

Creditors often share their information about their customers' credit record, directly or via information brokers such as credit bureaus and rating agencies. Besides helping them to spot bad risks, this informational exchange acts as a disciplinary device. If creditors are known to exchange data...